Finding Your Added Value in Insurance Distribution

The distribution process for personal insurance today is opaque and inefficient. One thing that carriers, agents, and customers can probably all agree on is that it’s time for some changes in the current system.

Each party has their own challenges. The difficulty that consumers have in finding an accurate price and a good shopping experience is mirrored by the difficulty that insurance agencies have finding and retaining customers. Carriers are being forced to rethink their models, often moving towards impersonal direct channels to ensure sales, unfortunately excluding their local agent base in many cases.

So how do you add value to this process that seems inherently flawed? Let’s start by identifying the unique obstacles faced by each stakeholder in insurance distribution:

Do these problems sound familiar?

With 2015 data showing yet another increase in the number of consumers shopping for their auto insurance online (up to 71% from 67% in 2013), many carriers and agents feel that the move to a virtual shopping process is imminent.

Although investing in technology is important in today’s market, insurance distribution as we know it is far from obsolete. In fact, even though many consumers are looking for auto insurance quotes online, about 80% of shoppers still end up completing their purchase with an agent or call center representative.

So, the carrier-agent-consumer method of operating still works, the process simply needs to be fortified.

Rather than the siloed approach to tackling the issues above, both parties should be trying to figure out how they can add value to the system-as-a-whole. Carriers should seek ways to empower the agents that they work with, making it easier for them to make the sale. Agents should try to align themselves with carrier strategies all the while adapting their practices to respond to the on-demand generation of consumers who expect a quick and seamless purchasing experience.

The value chain of insurance distribution should look something like this:

With agencies and carriers working together to strengthen the insurance distribution process, consumers will feel the results of the enhanced purchasing experience. Online technology can’t match the expertise of a professional agent, which is why it is important to give agents the tools that they need to grow their business.

To learn more about how our all-in-one sales enablement toolkit empowers independent agents and improves insurance distribution, request a demo of Apliant today.

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One comment on “Finding Your Added Value in Insurance Distribution”

I am starting to look for some new insurance. So, I like that you pointed out that if a company has seamless customer service would be a good thing to look for. I wouldn’t want to worry about having problems when it comes to getting help.